“Although low inflation is generally good, inflation that is too low can pose risks to the economy – especially when the economy is struggling.” – Ben Bernanke

“The true measure of a career is to be able to be content, even proud, that you succeeded through your own endeavors without leaving a trail of casualties in your wake.” – Alan Greenspan

There you have it – the wisdom of two Ivy League educated economists who are primarily liable for the death of the American middle class. They now receive $250,000 per speaking engagement from the crooked financial parties their monetary policies benefited; write books to try and whitewash their legacies of failure, fraud, and hubris; and bask in the glow of the corporate mainstream media propaganda storyline of them saving the world from financial Armageddon. Never have two men done so much damage to so many people, so quickly, and are not in a prison cell or swinging from a lamppost. Their crimes make Madoff look like a two bit marijuana dealer.

The self-proclaimed Great Depression “expert” Ben Bernanke peddles pabulum about inflation being too low and posing dire risk to the economy, but is blasé that swelling the Federal Reserve balance sheet debt from $900 billion in 2008 to $4.4 trillion today with his digital printing press poses any systematic risk to the country and its citizens. Either his years in academia have blinded him to the reality of his actions upon the lives of real people living in the real world, or his real constituents have not been the American people, but the Wall Street bankers that pulled his puppet strings over the last eight years.

Now that he has passed the Control-P button to Yellen, he is reaping the rewards of bailing out Wall Street and further enriching them with QEfinity. Ben earned a whopping $200,000 per year as Federal Reserve chairman. He now rakes in $250,000 per speech from the very financial interests who benefited from his traitorous monetary machinations. I don’t think he will be invited to speak at any little league banquets by formerly middle class parents whose standard of living has been declining since the 1980s. Is it a requirement that every Federal Reserve chairperson lie, obfuscate, misinform, hide the truth, and do the exact opposite of what they say they will do?

“It is not the responsibility of the Federal Reserve – nor would it be appropriate – to protect lenders and investors from the consequences of their financial decisions.”– Ben Bernanke – October 2007

Greenspan, Bernanke and Yellen have always been worried about deflation, while even the government suppressed CPI calculation reveals that inflation has risen by 108% since the day Greenspan assumed office in August 1987. The dollar has lost 52% of its purchasing power in the last 27 years of Fed induced bubbles and busts. And these scholarly academic bozos have been worried about deflation the entire time. Since Nixon closed the gold window in 1971 and unleashed the two headed inflation loving gargoyle of debt issuing bankers and feckless self-serving politicians upon the American people, the dollar has lost 83% of its purchasing power (even using the bastardized BLS figures).

Any critical thinking person with their eyes open knows the official inflation figures have been systematically understated since the 1980’s by at least 3% per year. Should the average American be more worried about deflation or inflation, based upon what has occurred during the 100 years of the Federal Reserve controlling our currency?

I’m sure Greenspan is content and proud, as he succeeded through his own endeavors in rewarding, encouraging and propagating excessive risk taking by the Wall Street cabal during his 19 year reign of error. He exited stage left as the biggest bubble in history, created by his excessively low interest rate policy, blew up and destroyed the 401ks and home values of the middle class. This was the second bubble under his monetary guidance to burst. The third bubble created by these Keynesian acolytes of easy money will burst in the near future, further impoverishing what remains of the middle class and hopefully igniting a long overdue revolution.

Greenspan’s pathetic excuse for a career has benefitted those who owned him, while leaving a trail of casualties that circles the globe. His inflationary dogma, Wall Street enriching doctrine and Keynesian motivated schemes have drained the savings and confiscated the wealth of the middle class through persistent and devastating inflation. And it was done by a man who knew exactly what he was doing.

“Under the gold standard, a free banking system stands as the protector of an economy’s stability and balanced growth… The abandonment of the gold standard made it possible for the welfare statists to use the banking system as a means to an unlimited expansion of credit… In the absence of the gold standard, there is no way to protect savings from confiscation through inflation” – Alan Greenspan – 1966

The abandonment of the gold standard in 1971 set in motion four decades of consumer debt accumulation on an epic scale, currency debauchment, and real wage stagnation. The consumer debt accumulation was a consequence of the American middle class being lured into debt by the Too Big To Trust Wall Street banks and their corporate media propaganda machine, as a fallacious response to stagnating real wages when their jobs were shipped to China by mega-corporations using wage arbitrage to boost quarterly profits, their stock prices, and executive bonuses.

The bottom four quintiles have made no progress over the last four decades on an inflation adjusted basis. The middle quintile, representing the middle class, has seen their real household income grow by less than 20% over the last 43 years. And this is using the understated CPI. In reality, even with two spouses working today versus one in 1971, real household income is lower today than it was in 1971.

The more recent data, during the Greenspan/Bernanke inflationary era, is even more disconcerting and destructive. Real median household income has grown at an annualized rate of less than 0.5% over the last thirty years. During the bubblicious years from 2000 through 2014, while Wall Street used control fraud and virtually free money provided by the Fed to siphon off hundreds of billions of ill-gotten profits from the economy, the average middle class family saw their income drop and their debt load soar. This is crony capitalism success at its finest.

The oligarchs count on the fact math challenged, iGadget distracted, Facebook focused, public school educated morons will never understand the impact of inflation on their daily lives. The pliant co-conspirators in the dying legacy media regurgitate nominal government reported income figures which show median household income growing by 30% over the last fourteen years. In reality, the real median household income has FALLEN by 7% since 2000 and 7.5% since its 2008 peak. Again, using a true inflation figure would yield declines exceeding 15%.

Greenspan and Bernanke’s monetary policies loaded the gun; Wall Street bankers cocked the trigger with their no doc negative amortization mortgages, $0 down – 0% interest – 7 year subprime auto loans, introducing the home equity line ATM, and $20,000 lines on dozens of credit cards; the media mouthpieces parroted the stocks for the long run and home prices never fall bullshit storyline, encouraging Americans to pull the trigger; government apparatchiks and bought off politicians and their deficit expanding fiscal policies, pointed the gun; and the American people pulled the trigger by believing this nonsense, blowing their brains all over the fine Corinthian leather interior of their leased BMWs sitting in the driveway in front of their underwater McMansions.

Median household income in the United States peaked in 1999. The internet boom, housing boom and now QE boom have done nothing beneficial for middle class Americans. They have been left with lower real income, less home equity, no savings, and no hope for a better tomorrow. Most states saw their median household income peak over a decade ago, with more than half the states experiencing double digit declines and ten states experiencing declines of 19% or higher. It’s clear who has benefitted from the fiscal policies of spendthrift politicians and the spineless inhabitants of the Mariner Eccles Building in the squalid swamplands of Washington D.C. – the pond scum inhabiting that town. The median household income in D.C. stands at an all-time high. Winning!!!!

A former inhabitant of Washington D.C. spoke the truth about inflation and the men who benefit from it in the 1870’s. He was later assassinated.

“Who so ever controls the volume of money in any country is absolute master of all industry and commerce and when you realize that the entire system is very easily controlled, one way or another, by a few powerful men at the top, you will not have to be told how periods of inflation and depression originate.”– James Garfield

The Federal Reserve, a private bank representing the interests of its Wall Street owners, has been in existence for 100 years. It has managed to diminish the purchasing power of the dollar by 95%, while causing depressions, enabling never ending warfare, allowing politicians to expand the welfare state to immense unsustainable proportions, and enriched its true constituents on Wall Street beyond the comprehension of average Americans. In 2002 Ben Bernanke made his famous helicopter speech where he promised to drop dollars from helicopters to fight off the ever dangerous deflation. After the Fed created 2008 worldwide financial collapse he fired up his helicopters, but dropped trillions of dollars on only one street in America – Wall Street. He dropped turkeys on Main Street, and we all know from Les Nesman what happens when you drop turkeys from helicopters.

Les Nesman: Oh, they’re crashing to the earth right in front of our eyes! One just went through the windshield of a parked car! This is terrible! Everyone’s running around pushing each other. Oh my goodness! Oh, the humanity! People are running about. The turkeys are hitting the ground like sacks of wet cement! Folks, I don’t know how much longer… The crowd is running for their lives.

Arthur Carlson: As God is my witness, I thought turkeys could fly.

The intellectual turkeys running this treacherous institution create a new and larger crisis with each successively desperate gambit to keep their Ponzi scheme alive. Even though Greenspan, Bernanke and Yellen are highly educated, they are incapable or unwilling to focus on the practical long-term implications of their short-term measures to keep this perverted financial scheme from imploding. Denigrating savings and capital investment, while urging debt financed spending on foreign produced trinkets and gadgets passes for economic wisdom in the waning days of our empire. Courageous and truthful leaders are nowhere to be found as the country circles the drain. Farewell middle class. It was nice knowing you.

“There are men regarded today as brilliant economists, who deprecate saving and recommend squandering on a national scale as the way of economic salvation; and when anyone points to what the consequences of these policies will be in the long run, they reply flippantly, as might the prodigal son of a warning father: “In the long run we are all dead.” And such shallow wisecracks pass as devastating epigrams and the ripest wisdom.”– Henry Hazlitt – Economics in One Lesson

134 Comments

llpoh says:

First, I want to comment about the chart re household income by quintile and top five percent.

Let us assume that income very broadly and basically tracks intelligence – which it does to a significant extent.

The bottom quintile of income earners would have an IQ of 86 and under. The bottom 40% would have an IQ of 96 and under, the bottom 60% would have an IQ of 104 and under, the bottom 80% would have an IQ of 114 and under, and the bottom 95% would have an IQ of 127 and under. In other words, the top 5% would have IQs over 127.

So basically, what that chart shows, when you translate earnings = intelligence is that folks with IQs of 114 and above have seen their real wages increase, and those with IQs below that, particularly below 104, have seen their earnings stagnate.

Wow, now there is a fucking surprise.

Guess what has happened in the world? Technology is king. Most folks with IQs below 100 simply are not capable of value adding in a high tech world. Those folks, by and large, are capable of manual labor, and not much more. Those folks in the bottom quintile are largely incapable of even that. And manual labor jobs are becoming fewer and fewer. Manufacturing is automating. Construction is automating. Farming is automating.

What is left for the folks in the bottom 60% then? Service jobs, that’s what.

Even those folks in the 60-80% quintile will struggle, as they are very much at risk from global competition. The Chinese and Indians will do their mid-level jobs cheap.

And what about the ones in the top 5% – those with IQs over 127? Well, golly, those folks are smart, and by and large they are really well educated. Fact is, US education for those types of folks is still, if not the best, among the world’s best. And fact is, you cannot outsource EVERYTHING, so those folks will remain in demand.

There is no middle class work available for the bottom 60 percent. They simply are not smart enough to thrive in the current economy, their educations are too poor, and they have poor work ethic.

The top 5 or 10 percent will do well. The rest better do something to lift their game, or they are screwed.

I do not mean to disparage the point re inflation – it is everything the Admin says and then some.

However, inflation is just one factor destroying the middle class. Another is what I have pointed out – that the current economy is no longer founded on manual labor, and is rather tech driven. You have to be reasonably smart to do those jobs. If you are not, then you have problems. You will be forced into service industries, as jobs that can be outsourced to low cost areas will be outsourced to low cost areas.

But even if outsourcing did not happen, the days of the bottom 60% living middle class lives were coming to a rapid end. Those folks simply cannot value add in a high tech economy. Outsourcing sped up the process, but the process is inevitable nonetheless.

Let ‘s not assume income basically tracks intelligence. I recall your many exhortations that success is due to a strong work ethic and other sterling character qualities. Besides, Admin just put in a fair amount of effort to explain that Greenspan and Bernanke are highly-compensated idiots. Or, perhaps evil masquerades as stupidity. Anyway, I suggest you are way oversimplifying a complex and convoluted situation.

Gayle – income tracks intelligence. There is no doubt about it. Education tracks intelligence as well. There are many, many examples where folks do very well indeed with just ordinary intelligence, but as a truism the smarter the cohort, the more money the cohort makes. Some very smart folks drop down to lower levels of income, and some middling folks move up.

However, it is very difficult indeed for a person in the bottom quintile of intelligence to make a decent living.

Do not let a desire to blame every ill on the government/Fed prevent you from seeing the truth that the world has changed so substantially as to make it nearly impossible for less bright folks to make a good living. Technology has changed the world.

Let us assume that income very broadly and basically tracks intelligence – which it does to a significant extent.

The bottom quintile of income earners would have an IQ of 86 and under. The bottom 40% would have an IQ of 96 and under, the bottom 60% would have an IQ of 104 and under, the bottom 80% would have an IQ of 114 and under, and the bottom 95% would have an IQ of 127 and under. In other words, the top 5% would have IQs over 127.

So basically, what that chart shows, when you translate earnings = intelligence is that folks with IQs of 114 and above have seen their real wages increase, and those with IQs below that, particularly below 104, have seen their earnings stagnate. -llpoh

I am going to have to disagree. My IQ changes by the IQ test I take. From 120-160.

Intelligence doesnt automatically equal wealth. I became licensed to work on aircraft because I enjoyed them and the outdoors, Working in a office makes me a tad crazy.

And as to those ‘trained economists’ such as Bernanke, he is just spouting rote trained BS IMO.

What do you suppose would happen if I handed Donald Trump a set of wrenches and told him to rig the flight controls of that 767, over there, on the ramp?

He has more money than me, certainly, but can he do the actual job of making that thing fly right, if he such a genius? BTW, I cannot do what he does either, I dont have the desire of high finance. But I would think he is no more intelligent than me or I him and the amount in your bank account is surely no indication of ones intelligence quotient.

Could the chart be skewed because a certain percentage of smart people have access to salaries that are not only above average but far above average (doctors, lawyers)? Admittedly, someone with an IQ of 114 can’t access those fields. But what of the PhDs waiting tables and driving taxis? They are not in that predicament because they can’t handle technology. If technology is to blame, isn’t it because of the jobs it has made irrelevant?

There are people out there with an athletic ability, which is a form of IQ, or lawyers that can create all kinds of wordsmithdom, than can beat me all day long, yet they cannot fix plumbing in their own home and plumbers are dumbasses.

Who here has not called a dumbass to their home to fix the plumbing or repair the air condtioner? What lawyer repairs his own car? What housewife fixes her own washing machine? And where the hell do I find this ‘codification of society’ that says those who do what you can’t are automatically stupid?

This is about a huge cohort of tens, perhaps hundreds of millions of folks. Any individual person’s IQ is subject to serious error in calculation.

But the 10 million folks in the top decile of IQs is undoubtedly smarter overall than the 10 million in the next million down. And those top 10 million folks make A LOT more money than the next ten million.

And so, GENERALLY SPEAKING, smarter people make more money than those less smart. And the bigger the gap, the greater the difference in income.

And what I said was specifically re managers, not folks in general. If you take my peers – manufacturing managers – there are reasonably few – perhaps one out of hundreds or thousands – of them that can do the 5% of my job that makes me money. A lot of the difference relates to innate intelligence, but there are other factors – experience, education, etc. that play a part as well.

But thee are a lot more plumbers, electricians, auto mechanics out there that can repair my goods than there are folks that can do my job. And hence, as a truism, I make more money than they do.

KB – I do not 100% know if the charts are accurate. Supposedly it is simply a table of earnings and IQs.

You can ask the same question of any chart or stat ever posted.

Re your question can CEOs fix a car, etc? Of course not – they lack training and experience. But given that, they generally could do so. However, your average mechanic could not generally do their jobs, no matter how much training and experience they might have or get.

But thee are a lot more plumbers, electricians, auto mechanics out there that can repair my goods than there are folks that can do my job. And hence, as a truism, I make more money than they do. -llpoh

Since when was an ideology, such as money, ever make one smarter than another? There are no studies that support the idea that money is somehow infused to your DNA or that it makes your more intelligent.

KB – a lot of them are. Bill Gates is, for instance. CEOs tend to have high IQs. Different experiences, opportunities, skills would be factors – personalities also play a huge role in who moves up to CEO. I was not suited to it.

I love the fact that people think that the middle class can be/could have been saved if only govt would/have make/made better decisions. They hold on to the belief of American entitlement, no matter what. They have seen their livelihoods eroded, and need someone to blame. They cannot accept that the reality is that the US rode a once in a century wave of opportunity to middle class affluence, and that that wave of opportunity has dissipated, and that there will be no second wave.

Middle class affluence is over. It is not coming back. It was based on high wages for manual, low skilled jobs. Technology and global competition has killed those jobs. And as Steve Jobs said to Obama’s face and to his disbelief – they are not coming back.

You have to be kidding me. The high IQ people who leave open borders, allow the drug cartels to run amok , free trade with communist China, depend upon Russia for our space program, put people of certain ethnicity in important jobs instead of the most qualified , My nephew is a Dr.. in micro biology and has had to work for me in my construction business his whole life and whom I consider a complete boob with hands on work who has no ability to function as well as I did as a high school kid. I see how the Forest service, police, and other jobs have been completely taken over with complete incompetent morons who are never held accountable as they were 30 years ago. Tell your B,S. to some one else who isn’t old enough to believe your B.S. We are a corrupt banana republic with out freedom or a future . Why do you think we are loosing freedoms everyday. People with high IQ’s would have to actually compete with the so called people of loe IQ’s on an even playing field. We all know that will never happen.

What is your point re cops and the forest service? Those fuckers do not fit into the high IQ category – far from it. And if you think police have ever been anything but corrupt motherfuckers, you are an idiot. Cameras everywhere are just making them more visible. Cops have always been assholes.

Corrupt banana republic – probably not far from the truth.

But low IQ folks cannot compete with high IQ folks. Half – or more – of folks have IQs below 100. Good luck with those folks competing in a high tech economy.

The US is getting its ass kicked because other countries sell the labor of smarter, harder working folks at lower rates, and technology has eliminated the jobs that used to pay low skill low IQ people well. Free trade agreements, govt corruption, bad decision making, the Fed, etc. have sped things up, but tech was killing those jobs anyway. It was going to happen, sooner or later. It is now sooner.

Why are we losing freedom every day? Because most people are idiots, and are more concerned about their free shit, their entitlements, their Mansions and their big screen TVs and their vacations to worry about little things like freedom. Security – or perceived security – is preferred to freedom by most folks. They are idiots.

The high IQ folks are winning – and they will continue to win. Smart trumps stupid almost every time. And there is a shitload of stupid out there.

Why do you own a company? Probably because you are smarter than average. Smarter than your workers. Or harder working. Or better experienced. Or more ambitious.

The fittest thrive – that is all there is to it. Humankind is defined by its intelligence. The smarter a person is, the more likely they are to thrive and survive.

Your assertion that intelligence quotient is the only contributing factor in cataloging the predominance of people working in a particular field is absolute fucking hogwash. As any clinical psychologist who administers the testing will tell you, IQ is not a baseline for the assessment of general intelligence. Not all tech industry jobs are held by MIT grads, and there are a demonstrably inordinate number of dipshits earning top money in upper management positions. But more importantly, where in the hell do you get off assuming that even a marginal number of top wage earners in any classification of profession, much less IT workers, have all been subjected to an IQ test? Really? Who are you, the amazing Kreskin?

What a pointless argument, the one thing you forget is entitlement. those born with a silver spoon will always get a running start over those less affluent. If you are fortunate enough to be born into the right family you more than likely will get the opportunity to attend the better credentialed colleges and therefore have doors opened in front of you. If you are born in a ghetto, no matter what your intelligence you more than likely wont get the opportunities to improve yourself.
IQ, of course plays a part, but opportunity is far more influential. And anyway, what will you do with all that coin when you are dead? With the attitude of llpoh boasting about his salary and IQ while many people suffer, I feel sorry for your soul. Enjoy your wealth it wont last forever.

Nelson – blow me too. Where did I say that? Actually I said there were many exceptions to the general rule. But if you think morons can be doctors, you are out of your mind.

What I said is that the higher the IQ of the group, the more they earn. That is a fucking fact, you stupid piece of shit. Are you too stupid to understand that? I posted the stats from the Bureau of Stats. You do not like them, tough fucking titty. I did not make them up. Most folks have taken IQ tests in one form or another. Whether they sampled large or small groups, I do not know. Why don’t you find out and let me know? Funny thing, you can extrapolate a lot from sampling. I guess that is too hard a concept for you to understand, you fucking cretin.

Your bullshit anecdotes are worthless. I posted facts. And based on those facts, I proposed possible reasons why those facts exist.

Just what jobs do you think that folks with modest intelligence can do to make good money? I am not talking about rare individuals, but the entire group of people in the bottom half?

And by the way, your associating of low skill jobs with low IQ reveals just how out of touch with reality you are. Tell that to anybody who went and got an Ivy league education and cant find work in their chosen field. I know several, including a highly intelligent well educated biologist with two separate degrees who is working at a meat packing facility just to make ends meet because he cant find an employer who doesnt think hes overqualified. I suppose in your arrogance youre going to tell me he shouldve went to ITT Tech instead…

Kudegras – it is what it is. Wealth correlates less to intelligence than does earnings, due to inheritance. I did not forget that point. Your comment re opportunity is not supported by fact re earnings. The correlation there is intelligence. Your point re born into affluence is somewhat correct, but not entirely. Poor folks tend to be less intelligent and have offspring that are too. Thus the offspring are generally going to remain poor. Their smarter offspring are disadvantaged a bit, but they can still get out. I can personally attest to that.

I guess you think I should rather have done nothing with my life. Instead I built a business and employ folks and pay taxes and make things.

Not everyone can be a taker. Some folks actually have to make things.

I am not responsible for folks suffering. Not my fault. Quite the contrary. What I have done has given many people the chance to get themselves out of poverty. I provide good paying jobs to modestly skilled people.

How about you? How many people live good lives economically because of what you have done?

“Most folks have taken IQ tests in one form or another”…
Now I know youre full of shit. You didnt prove JACK FUCKING SQUAT with such an obviously blanket statement with absolutely no concretization of facts to substantiate it. YOU BLOW ME.
Quick suggestion moron. Google “IQ tests”, who creates them, who administers them, and the literally endless accounts of people whose lives have been destroyed and victimized by the evaluations that have proven baseless in determining an individuals ability to solve real world problems and think outside some university funded analysts tiny, box like view of the universe. I dont mind being heckled, but if youre so unwilling to bend in your views, maybe you shouldve been a politician. And, there you go, yet another well paying job for blithering idiots..

There is a factor that, needs to be added, common sense, show me a common sense test. There are people with high IQ’s that couldn’t change their own tire. And in a SHTF situation common sense will be the deciding factor who survives and who dies.

I woke up this morning and saw 48 comments on this thread and thought it must have gone viral. Nope. Llpoh and KB had an epic pissing match at 3:00 am.

IQ certainly has a major impact on household income, but the distribution of high IQs to low IQs is the same as it was in the 1950s, 1960s, 1970s, 1980s, 1990s and so on. You have always been able to break IQ into quintiles or deciles. Statistics are awesome in that way.

So that has not changed. What has changed since 1971 is the distribution of income among those quintiles. If the IQ ranges had always existed, why didn’t the extreme variation in household incomes also always exist?

What happened was the gutting of the manufacturing base of the country by mega-corporations practicing wage arbitrage and calling it globalization. It didn’t have to happen. It didn’t happen in Germany. They have a much higher cost base than the US, but their manufacturers did not throw their middle class workers under the bus.

The US leaders chose to financialize our economy by encouraging debt creation and consumption, rather than savings and capital investment. You get more of what you encourage. The middle class has been gutted and there is plenty of blame to go around, but blaming it solely on IQ distribution is way too simplistic.

What benefit did society gain from the Finance sector generating 10% of total corporate profits for decades accelerating to 40% of corporate profits just prior to the worldwide financial collapse caused by the Finance sector?

“For instance, SAT scores roughly translate to IQ scores”..
Bwahaha!!.. You mean, an aptitude test created and administered by statists in order to evaluate the level of education one has recieved from the highly venerated (sarcasm) American public school system? Are you fucking high?
I hate to boomerang your ridicule back atcha, but if the SAT is the litmus test for intellectual prowess, we are a nation of very, very stupid fucking people. You need to reexamine your stance. Truthfully, I guess I got your goat but Im really not trying to piss you off. In principle, I do get that above average intelligence gives one a tactical advantage in the job market. And if that was the meat of your argument I wouldn’t take issue with it. But youre trying to equate intelligence quotient with income inequality, and there is NO EMPIRICAL DATA to back it up. None. Zip. Zilch. However, theres plenty of evidence to support a host of socioeconomic factors which have nothing to do with test scores. Again, I dont dispute the predilection some people have with intellectual laziness. Hell, even John Wayne said, “lifes tough, but its a lot tougher if youre dumb”, or something along those lines, lol.

Admin – some of what you say is true re manufacturing. But not quite. Remember what I said re the ever progressing 2.5 percent yearly improvement in manufacturing productivity? Here is a chart showing mfg as a percent of total labor force. Please feel free to point out the year or period when globalization inflected the line downward. Here is a hint – it didn’t.

Also, you are incorrect re Germany. Their line tracked exactly with the line in this chart, until…. The fall of the USSR. Germany began to loan money to the Eastern European bloc, in exchange for them buying German manufactured goods. Sweet! That, combined with Chinese thirst for luxury goods, etc, stopped the down trend. But German banks are leveraged to the hilt and are hugely insolvent. German wages are low, and German participation rates are even lower than US rates.

Germany is not the shining example you propose.

The fact is, the lower classes will stagnate and fall, while the upper class will continue to thrive, for a time anyway. Low skill high paying jobs are gone.

This shit is my sweet spot. You are far ahead of me re financial stuff, but one thing I understand is manufacturing. Manufacturing jobs are disappearing because manufacturers are so damn efficient. Other reasons too, but you simply cannot outrun that 2.5% efficiency gain each year.

I sometimes wonder if, when we look back on this particular time in history, we will realize the sacrifices made in the name of wealth.

My own father is one of the most brilliant men that I know. He was one of the developers of a pivotal computer language in the early 1960’s. He had no degree, simply a desire to provide for his family and a mind that was made for solving problems. His love of music, literature, art and nature provided me with the kind of childhood that most people could only dream of and though he did well financially, we lived simply. About ten years into his career he discovered that the higher he climbed in the corporate world, the more profoundly dissatisfied he became with his life and one day out of the blue he decided to chuck it all and open a small shop in the University town where we lived that sold high quality, locally produced food. Mind you this was in the 1970’s, way before anyone used the term organic. He was known locally as the health food nut.

As I grew up I noticed that the fathers of my friends were all wealthy, owned big homes with tennis courts and indoor pools, travelled the world on holidays and sent their children to the finest schools, but none of them appeared to be happy. They were grumpy, distracted, miserable pricks whose sons hated them, whose wives cheated on them and whose lives were built on their acquisitions. My father, on the other hand was well respected by a huge number of people who loved to engage him in discussions on virtually any topic- professors, politicians, economists, pot growers, cops, headmasters, pyrotechnic experts, farmers and bankers. If you expressed an interest in any topic and shared it with him in casual conversation, you could count on the fact that at your next encounter my father would dig into his worn out book bag and bring out carefully clipped articles on whatever it was that had been discussed previously and almost without exception the recipient would stand there in awe of the newly discovered tidbit. It was not unusual for me to find guys like Ralph Nader drinking wine out of a juice glass in our study with my father, or to see him laughing it up with John Nash in the storeroom of his shop. He used to trade fruit smoothies to Stanley Jordan in exchange for having him hookup his pig nose amp in the store and play his unique finger tapping guitar licks for the customers long before there was a recording contract. In short, he chose to put all of his energies into living his life rather than to amassing financial instruments.

My father had the kind of intelligence you would expect from someone in the one percent, but the kind of values rarely seen outside of church yard. While other people added to their stock portfolio, he spent his money on season tickets to the Metropolitan Opera and on hiking the Appalachian trail with his son.

I understand that in the world we inhabit it is virtually impossible to exist without some means of income. As self sufficient as I have become I still pay property taxes, send my children to the dentist, buy fuel for our vehicles and insurance on our home, but what I don’t have to do is be shackled to the accumulation of financial instruments- not the same thing as wealth. Prior to becoming a farmer I owned a business not far from Admin and was one of the one percent and saddled with all that comes with it- the stress, the employee problems, the taxes, the regulatory compliance, the audits, the infrastructure, the sub-contractors and vendors, and every outstretched and open palm looking for a cut. I quite literally felt like a slave to the wealth I was accumulating at the expense of my health, my sanity and even my own family. Never once did my father express an opinion about what I was doing because he knew that it was my life journey and that only my own discovery of what was important in life would be enough to affect the kind of change I would eventually have to make for the betterment of my family and myself.

Last week was a tough one- building fences, cutting timber, moving livestock onto pasture, planting, tilling, building a barn- and each night I climbed into bed physically exhausted, but comforted and surrounded by a loving family on a well tended patch of earth. On the morning of my birthday I received a card and a book from my father and when my wife called me over to give it to me I sat down in the sunshine and opened the cover and read this inscription.

To My Son on his birthday,

I am so proud that you have taken up the noblest task of all.

All my love,

Dad

I no longer have a gold plated insurance policy, don’t own a 401K, earn less than anyone in the FSA and still I feel like a wealthy man. Intelligence is indeed a predictor of income and accumulated wealth can be passed on to subsequent generations as a kickstart towards a future, but the real measure of a man is in the living of his life, the choices he makes and the consequences he lives with. I have no idea what part of the 1% sleep the sleep of the just, feel confident in the love of their wife or the respect of their children, add something to the world rather than strip something off of it, but to believe in my heart that I had been truly successful in life I would rather have that single book with its inscription than a hundred million dollars.

Imagine the kind of world we would live in if more of us felt that way.

“Haven’t IQs always been broken into quintiles? Did IQs as a whole decline from the 1950′s through to today?”

I would guess that what declined between the 1950’s and today isn’t IQ (use of it, certainly) but the US hegemonic advantage. For example human populations in Europe and Asia- I leave out Africa for obvious reasons- has its fair share of right hand side of the bell curve IQ. Where was their middle class during that period? Our industrial, managerial, academic and military superiority during the post war era was the driver of the bell curve masses getting a cut of the pie. Since globalization the middle has been replaced by low wage third-worlders in order to drive up the returns for the top- seems pretty obvious unless I am overlooking something else.

Lipoh I’m sorry but I’m not bent that way so you will have to blow your self. I was referring to an even playing field that doesn’t exist in this country anymore. It is easy to make money if you can create it yourself, control other peoples thoughts through media ownership, regulation that stifles competition, and an educational system that creates dumb down people like domesticated sheep. Watch the time machine and you will understand what I’m talking about. Competition, accountability of ones actions and true freedom is the creator of intelligence and wealth. Lobotomized cattle chewing their cud watching reality shows doesn’t create higher thinking. When motivation to excel is destroyed you end up with an oligarchy as we have today. Now you can reply with a very high IQ response such as blow me.

@hardscabble farmer: I would, without doubt, have loved to have met you Dad. For that matter, I would like to meet you and your family too. You have your head on straight, your priorities perfect and I’m glad to read comments from a smart, happy man..

You can make money all sorts of ways including theft, fraud, luck, rich parents, winning the lottery, not being handicapped, not being black, not being born in a poor country, etc etc.

None of the above have anything to do whatsoever with intelligence.

One fact is true: those who have money, THINK they are more intelligent.

Last note: those who think the middle class don’t matter – really need to get out more. The reason the United States and Europe are nice places to live is because they have civil societies – civil societies built by and composed of a more or less successful integration of all levels of society.

Can the same be said for hellholes? Are the most successful in these hellholes the most intelligent? Or merely the most willing and able to victimize their brethren?

It was said: “The top 5 or 10 percent will do well. The rest better do something to lift their game, or they are screwed.”

One of the ways the rest can ‘do something’ to lift their game is to throw down the top 5 or 10 percent.

Of course, the author of this quote actually is either intentionally misleading or ignorant. The causes of inequality and the destruction of the middle class are not due to the 5 or 10 percent. They are due to the top 0.5%.

To the truly rich, the top 5 or 10 percent are no different than the rest. Just not yet consumed or are useful tools.

Comparing IQ from the 1950’s to today is an exercise in futility. Do you think IQ Tests are the same today as back then? They are not. IQ tests have been dumbed down. Dumbasses were a minority when I was a kid, Today, it seems every other person I meet is a dumbass. We’re dumber than before, and getting dumber with every passing year.

“The true measure of a career is to be able to be content, even proud, that you succeeded through your own endeavors without leaving a trail of casualties in your wake.”
– Alan Greenspan

Well, well. well… Another of Alpo’s good friends, a lucky member of the saintly Chosenites’ relishing his role in hiding the destruction to his despised inferiors’ – the lowly Goyim of the West (or as I prefer, the Bolsheviks’ within and their usual Jews’ News media-mafia-apologists’ celebrating and covering for their banking-brethrens’ unspeakable crimes against humanity):

“…In interviews on two high-profile television programs — with Maria Bartiromo on CNBC and with Leslie Stahl on CBS’ 60 Minutes — Greenspan admitted, with smug satisfaction, to willfully deceiving Congress when addressing them under oath about some of the most important Fed policies affecting the national and global economies. This blatant deception — in essence, lying — Greenspan brazenly, but casually, described as “purposeful obfuscation” and “destructive syntax.”

Were his interviewers outraged by this shocking confession? Far from it; the revelation only seemed to deepen their awe and fascination. The September 17 on-screen performance of CNBC’s Bartiromo was especially embarrassing to watch. Ms. Bartiromo, supposedly the consummate news professional, wavered between star-struck hero-worship and giggling girlie flirtation.

Here is the crucial exchange between the breathless Bartiromo and Greenspan:

Maria Bartiromo: All of these important economic events you are overseeing — the most important institution, and leading things. And then not only are you dealing with these crises, but then you’ve got to convey what’s going on to people. That means Congress, the president, the media, the public. So what? You come up with Green-speak.

Alan Greenspan: Otherwise known as Fed-speak.

Maria Bartiromo: What is it?

Alan Greenspan: It’s a — a language of purposeful obfuscation to avoid certain questions coming up, which you know you can’t answer, and saying — “I will not answer or basically no comment is, in fact, an answer.” So, you end up with when, say, a congressman asks you a question, and don’t wanna say, “No comment,” or “I won’t answer,” or something like that. So, I proceed with four or five sentences which get increasingly obscure. The congressman thinks I answered the question and goes onto the next one. [Emphasis added.]

Likewise, in his September 13 interview on 60 Minutes, Greenspan proudly paraded his record of deceit and misdirection. CBS’ Leslie Stahl tells us that “in public Greenspan was inscrutable whenever Congress asked about interest rates. He resorted to an indecipherable, Delphic dialect known as ‘Fed-speak.’” The 60 Minutes transcript then proceeds with this account of their conversation:

“I would engage in some form of syntax destruction, which sounded as though I were … answering the question, but, in fact, had not,” Greenspan admits, with a chuckle.

At one hearing, Greenspan said, “Modest pre-emptive actions can obviate the need of more drastic actions at a later date, and that could destabilize the economy.”

“Very profound,” Greenspan says, after listening to his testimony.
Greenspan personally worked on these “profound” comments.

“But what would often happen is you’d get two newspapers with opposing headlines, coming out of the same hearing,” Stahl remarks.

“I succeeded. I succeeded,” Greenspan says.

Succeeded? Succeeded in deceiving many (but not all!) of the congressmen to whom he was testifying. Succeeded in deceiving the American people as a whole. Succeeded in maintaining his mythical status as the all-wise, all-powerful Wizard of Oz of monetary policy.

But he succeeded in this ongoing deception for 19 years (and continues today as the venerable Fed chief emeritus) only through the indispensable assistance of the major media. Instead of serving as the watchdogs of the public interest as they are supposed to, they have become the lapdogs of the big banking-big business-big government interests that are hijacking our economy and our country.

Instead of, like Toto, pulling back the curtain to expose the Wizard’s deception and sham powers, they lick the Wizard’s hand and help him maintain the dangerous and unconstitutional power that the Federal Reserve system exercises over our economic and political destiny. While some of his media fan club have merely canonized him with sainthood, others among the Greenspan hosanna choir have actually elevated him to divine status.

One of the most shameless examples along those lines was the Time magazine cover story of February 15, 1999 by Joshua Cooper Ramo. Along with the ostentatious headline, “The Committee to Save the World,” the cover featured the beaming visages of Federal Reserve Chairman Alan Greenspan, then-Treasury Secretary Robert Rubin, and then-Deputy Treasury Secretary (and later Treasury Secretary) Lawrence Summers, with this riveting subtitle: “The inside story of how the Three Marketeers have prevented a global economic meltdown — so far.” This Time glorification attributed superhuman powers and virtues to the Greenspan-led trio, dubbing them “the Trinity.”

But in terms of the amount of adulatory attention devoted to Greenspan, recent media coverage gives new meaning to the word “excess.” On September 17, in addition to the hour-long interview with Maria Bartiromo, the NBC corporate family (CNBC/MSNBC/NBC) featured excerpts from the interview on its news segments and on programs such as Squawk Box, Squawk on the Street, The Call, Power Lunch, Street Signs, Closing Bell, Kudlow & Company, On the Money, and Fast Money. Not to mention a one-on-one interview with Matt Lauer on NBC’s popular Today Show.

CNBC’s marathon of Green-speak programming included: “Greenspan: Power, Money and the American Dream,” “The Greenspan Legacy,” “Greenspan on Global Growth,” “Greenspan’s New Book,” “Greenspan, Iraq & Oil,” “Greenspan on U.S. Consumers,” “The Maestro & the Professor,” “Greenspan on Foreign Investment,” “Greenspan Speaks,” “Greenspan and the Professor,” “Worldly Tenure,” “Honors and Accolades,” and “Greenspan Retrospective.” Many of these segments were recycled and then re-recycled for maximum overkill.”

Great article. History will remember Greenspan, Bernanke, and Yellen as the biggest criminals in history (along with Abe). Inflation and debt have wiped out this country. We peddle our debt to other countries in exchange for goods, which is insane really, but they’re dumb enough to fall for it, the legacy of our empire.

These three Jewish banksters have wiped out the middle class, and anyone with a job. They’ve wiped out the solvency of this country, and indebted our entire nation. They’ve allowed the profligate spending by the criminal socialist politicians, allowing them to spend $1 trillion a year they don’t have. Our public/private debt is $58 trillion, more than 400% of GDP.

Inflation is the silent tax, and we’ve been lied to for decades about real inflation rates. The government takes half your earnings in taxes, and inflation takes 10-11% a year, and you try to survive on what’s left. Our economy is going to implode in a smoking pile of debt, thanks to the Fed and criminal political class, who employ 142 million people (union government drone employees, welfare recipients, and disability). Without the Fed, socialism could not happen here. Simply stringing these people by a rope won’t undo the damage they’ve done. There’s a special place in hell for them, I’m hoping.

Admin – I already responded to the question re why the top “quintile” is still rising, and the others not. The economy has changed. The jobs that used to pay the bottom sectors well have disappeared. And fact is, the jibs that disappeared were overpaid to begin with. So the bottom quintiles are now left with service jobs, that truly do not pay well. Why is that difficult to understand?

Re your point as to why manufacturing corps are making less profit – seems to me they are under a lot of global competition. And internal competition – as fewer people are employed in mfg, the competition intensifies. it is very hard to turn a profit in mfg. My profits, for instance, are directly related to how many employees I have, more than anything else. Fewer employees means lower profits, by and large. Manufacturing, as an industry, is small, so therefore profits are harder to come by.

I notice you did not point out the deflection point on the chart that should exist because of your globalization argument, and I note you ignored my comments which blew up your ill-thought out comments on Germany.

You just think you know everything. As I said, mfg is my patch, and I have spent almost 40 years in it, during which time it has been a very difficult time indeed. It is an area I well and truly understand.

The biggest impact to mfg over the years is the steady, never-ending 2.5 percent per year increase in efficiency gain. It is the same as what happened to agriculture – where half the population used to be required in agriculture, it is now two percent.

Globalization, in my opinion, is more affecting non-mfg jobs – high value support jobs are flowing to low cost countries, leaving behind a higher percent of low value service jobs.

The chart re mfg jobs as a percentage of total jobs shows mfg job losses in a straight line decline for half a century. It is what it is. Globolazation or not, it will continue. Unless of course the US develops an Eastern Bloc to exploit as has Germany.

“My profits, for instance, are directly related to how many employees I have, more than anything else. Fewer employees means lower profits, by and large. Manufacturing, as an industry, is small, so therefore profits are harder to come by. ”

This is completely idiotic, as the entire offshoring movement can attest to. The real reason why jobs are moving offshore is bad government policy starting with health care, extending into taxation schemes, detouring into financial feudalism and culminating in an incestuous corporate management clique.

The expensive and relatively poor health care available to even employee Americans – you know, the one consuming 18% of US GDP – means corporations must pay employees more and more to give that sector of the US ‘economy’ (I put quotes in because this part is anything but economic) its pound of (literal) flesh. This large section of an already high living wage due to Americans paying over 25% of pre-tax income on housing (i.e. asset price inflation), combined with tax policies which literally reward the offshoring of jobs via transfer schemes, is why corporations move jobs offshore. Combine this with executives who are rewarded for the short term financial illusion of greater productivity – it doesn’t surprise me at all why jobs are moving out.

c1ue – what on earth do you do for a living? I run/own a manufacturing business. Yet you think you know more about my business than I do? You are really less than bright, aren’t you?

Corporations move overseas because of a range of reasons, but they all come down to one thing – money. First, the corporate tax rate in the US is the highest in the world. Second, wages are very high in the US – even at the minimum wage, wages are very high relative to many other nations. Third, there is massive red-tape and EPA issues, etc., that drive up costs. Fourth, many other nations offer larger pools of skilled employees ( for instance, if you have a need, you LITERALLY can hire THOUSANDS of engineers in China in a week. It would be impossible to EVER fill those positions in the US, much less to do that in a week.).

What does bad government policy have to do with the cost of labor being cheaper elsewhere? What do you propose, you Einstein you – huge import taxes?

Government policy could have reduced the corporate tax rate, the cost of red tape, etc. It would not have effected the decline in manufacturing employees to the extent of eliminating the decline – it would have flattened the slope of the decline somewhat, but not eliminated it.

Here is a little tidbit – the US is a major exporter of manufactured goods. The US exports around a trillion dollars in manufactured goods per year. What do you think would happen to the export market if the US put in place import taxes?

Your point re transfer schemes is idiotic. Transfer schemes are used to transfer costs to the US, and away from offshore entities so as to put the profits in the offshore entities. The problem is not the transfer scheme, as you put it, the problem is that the US corporate tax rate is the highest in the world.

So what would happen if the transfer schemes were eliminated? Well, the corporations would move ENTIRELY offshore, now wouldn’t they. The problem is ENTIRELY the absurd corporate tax rate.

And finally, you say “Combine this with executives who are rewarded for the short term financial illusion of greater productivity”, which proves you are a total, blithering idiot.

Greater productivity is no illusion. If CEOs are rewarded for increasing productivity, then I applaud them, I cheer them, I congratulate them on their success. That is high achievement indeed. Business desperately needs increased productivity in order to survive and thrive.

Unfortunately, it is rare that executives are rewarded for this. Instead, they tend to be rewarded for increasing share prices, or for increasing profits. Those indeed can be “short term financial illusions”, and they are rampantly manipulated and abused by executives.

Jeezus, Llpoh, our trade deficit is $500 billion a year. That’s half a trillion a year leaving the country. What difference does it make how much we export? And instead of having $500 billion a year to invest in CAPEX and other assets, we just give it away. It’s too late for import taxes, the jobs are gone.

China, Korea, Japan, every other Asian country limits their imports, severely. We export jets, weapons, some heavy machinery, and tech. And tech is getting slaughtered, thanks to the NSA and loss of trust in our government. Cisco lost $2 billion in sales to China thanks to the NSA, Brazil, Germany, England, India all are reducing tech spending significantly thanks to our fascist government and the NSA. Our government and Wall Street have wiped out this country. Well, that’s all I wanted to say.

I figured Admin would post this data from ZH, but he hasn’t. These are the highest paying jobs. Keep in mind being on welfare pays the equivalent of $54,000 a year in cash, free food, free healthcare and other benefits. Being on welfare is one of the best paying professions available today.

As you can see from the graph, there has been a steady decline in manufacturing jobs for fifty years, uninterrupted. Globalization will have added somewhat to the decline, but in the end, manufacturing is in steady decline owing to steady gains in productivity.

In 2010 the decline has flattened a bit, as productivity increases slowed, primarily as a result of many of the computer-driven productivity gains having been absorbed.

With or without globalization, manufacturing jobs would continue in decline. They are not coming back. Manufacturing jobs were the backbone of middle-class America. The US had a virtual monopoly on manufacturing in the world, but that monopoly has been broken. The monopoly allowed high wages to be paid to manufacturing employees. That is no longer the case – manufacturers shift to lower wage states, for instance, where costs of labor are lower. Manufacturing no longer offers a solid middle-class income in many instances – wages are falling in manufacturing, and will likely continue to do so.

As manufacturing jobs are being lost, they are being replaced, if at all, by low paying service jobs.

The fact is, the middle-class was an artificial bubble created by a US manufacturing monopoly. The monopoly has been broken. So now there will be a return to the mean trend line – see Europe for what that mean entails.

Government policy has hastened the decline, to be sure and certain. And the US has squander the opportunity to replace the lost manufacturing jobs with high-skill, value-adding jobs in science and tech. The US spent its money on “things” – widgets, free-shit for the FSA, etc., rather than investing its capital wisely for the future. It allowed its education system to fail, it spent hugely on wars, it allowed its infrastructure to crumble, it permitted inflation to erode its capital, as Admin so rightly decries, etc ad naseum.

The US had a huge advantage and head start, but pissed its advantage and its capital away not on investing for the future, but on instant gratification, and allowed its sense of entitlement to over-ride good, common sense.

Sorry LLpoh. I’m not buying your argument. It’s the middle quintile we are talking about here. You remember. This is an article about the MIDDLE class. The middle class incomes are in the $51,000 per year range. That is not your Wal-mart employees and burger flippers. Your misdirection with that line is worthless.

The top quintile is rising due to the top .01% siphoning billions from the economy through their capture of the economic system, political system and financial system. The vast majority of the top quintile have also seen their incomes stagnate.

The financialization of the economy by you Ivy Leaguers is the main reason for the growing inequality. IQ has very little to do with it. The scum on Wall Street do not have high IQs. They have a high level of immorality and sociopathic tendencies.

Your chart does not show a steady long term decline in manufacturing jobs. It shows an extremely moderate decline from after WWII until 1971 (30% to 26% over 20 years). After Nixon closed the gold window and unleashed the debt based consumption economy the % plunged from 26% to 9% over the next 40 years.

This was not due to efficiency gains. This was due to conglomerates like GE off-shoring their manufacturing to countries where they could pay slave labor wages, while pumping up their profits, stock prices and executive bonuses. Then they sold their shitty products back in America to people who used debt to buy the crap. You don’t need to have an IQ in the top quintile to see who won and who lost.

AWD – if you look at the components of what is imported, take a gander at SERVICES being imported. The issue, as I said, is not so much that we are now importing so much manufactured goods as it is that we are importing services. Not to mention oil products, etc.

We import around $500 billion more manufactured goods than we export. If we added that to the current total manufacturing output, it would be around a 25% increase in manufacturing jobs – less the fact that the US is more efficient. That would increase the percentage of jobs in manufacturing from around 8% to around 10%. The 10% percent would continue to fall at 2.5% per year.

So it means that the graph would shift a few years – globalization has pulled forward the demise of manufacturing by a handful of years. Which is what I have been saying – it is an issue, but it is not THE issue. The issue re manufacturing is that by becoming increasingly efficient, the industry is gradually eliminating itself.

The bigger issue is the accelerating globalization of high paying service jobs – now that is going to be a real problem.

And I do not know how you will prevent a company from sending work electronically back and forth. I do not see how import taxes, etc., will keep that from happening.

Admin – what say you pick the high point in 1955 of around 33% falling to around 23% 15 years later. As always, you cherry-pick your numbers. There has been a steady slope downward since 1955. Prior to that, you had the recovery from WWII going on.

Nice logarithmic graph that distorts the increased income of some sectors. Again, nice cherry-pick.

Admin – as you well know, I agree with much of your premise. But the fact is, the middle class was unsustainable, and owed its position to 1) the hugely beneficial position the US found itself in post WW11, and 2) it held its position via huge consumption of debt.

Yes, much is to be laid at the doorstep of banksters etc. – they have certainly expedited the crisis. But there is no way that the middle class was going to keep its position. It was artificial and unsustainable.

“”Median household income in the United States peaked in 1999. The internet boom, housing boom and now QE boom have done nothing beneficial for middle class Americans. They have been left with lower real income, less home equity, no savings, and no hope for a better tomorrow. Most states saw their median household income peak over a decade ago, with more than half the states experiencing double digit declines and ten states experiencing declines of 19% or higher. It’s clear who has benefitted from the fiscal policies of spendthrift politicians and the spineless inhabitants of the Mariner Eccles Building in the squalid swamplands of Washington D.C. – the pond scum inhabiting that town. The median household income in D.C. stands at an all-time high. Winning!!!!””

Is it wrong of me that I really was ROFLMAO on this paragraph? I mean, we know the folks at the top are not incompetent. So…..they really are winning! Too funny. America: You got what you voted for! And guess what? America will do it again in 2016. 2017-2020 should be interesting years.

Admin – I believe that the middle class was an aberration and was inherently unsustainable. I totally agree with you re the impact that the financial sector/government/corruption/general evilness has had.

But that said, I think that they have simply expedited the inevitable. Given the global nature of economies, and given the uniquely beneficial situation the US found itself in post WW2 no longer exists, I believe it is absolutely unavoidable that the middle-class as the US knew it in the 50s, 60s, 70s, etc., was going to implode. It has been more rapid and will be much deeper than need be, but it was inevitable nonetheless.

As I have said many times, 5% of the world’s population consuming 20+% of the world’s resources is simply not a sustainable position, and is sure and certain to come to an end.

AWD – if the US had spent the welfare money making itself more productive, there is a chance that the collapse could have been minimized, especially when combined with controlling/eliminating the things Admin is talking about. The US consumed when it should have been investing in the future.

Sorry llpoh. Look at the 1960s. There was a moderate decline from 29% to 26%. This was the hey day of the middle class. The manufacturing sector was not destined to disappear in America. It happened due to choices by corporate executives, politicians and Americans lured into debt by bankers. If Nixon had not closed the gold window, the explosion of debt would not have been allowed to happen. The consumer society would have been dead on arrival and the extreme disparity between the ultra rich and the middle class would not have happened.

Those graphs tell the truth. There is nothing distorted about them. Virtually the entire growth in incomes of the top 1% have been reaped by the .01%. Those are called facts.

The middle class DID NOT exist due to huge debt. The freaking credit card didn’t exist until 1969. The middle class of the 1960s was created through hard work, saving, and buying things with cash. The middle class began to die in 1971 when we allowed bankers and politicians to call the shots. The middle class was not artificial and unsustainable.

i would ask if smart forlks are so smart why do they always do things behind closed doors…have lobbyists…pay off poloticians manupulate lye and tell untruths …..maybe thats what u think smarts is…abolish the federal reserve act/irs….constitute executive order 11110.

Admin – the decline in the sixties was around 2% per year – much as I have been saying. That drop has, and will, continue year on year. Manufacturing gets more efficient. Thus the fall in mfg jobs as a percent of total jobs. It was destined to happen. It could have been delayed, but not prevented.

Currently the US makes a couple of trillion dollars worth of manufactured goods per year. If 26 percent of all persons currently worked in mfg – as in 1970, then that would be almost $7 trillion per year being produced. The US would need to be exporting around $5 trillion a year in that event. Not going to happen.

Admin – manufacturing is doomed the same way as agriculture jobs were doomed. Manufacturing jobs will continue to dwindle until such point as virtually all manufacturing jobs are automated. Then it will level out. It is not there yet. Give it another 20 years.

The middle class was created by the monopoly the US had in manufacturing. Even if that monopoly continued, the jobs would be disappearing at 2% a year.

For fuck sake, we finally hit 100+ posts. Admin works hard on this stuff, and every one of his posts deserves 100, 200, 300 comments. Get with the program, you loafers. I did the best I could this time to get things going, but we need more out of y’all.

If you could not find a problem with something I said here, you were not trying hard enough.

““Although low inflation is generally good, inflation that is too low can pose risks to the economy – especially when the economy is struggling.” – Ben Bernanke”
God forbid you should ever get more for your dollar(the assumption seems to be that unless prices are rising, people will be constrained from spending, when, given the normal condition of prices dropping due to productivity gains (as with computers) they would be enabled to buy more goods, creating new jobs- but it is perfectly copasetic in Ben’s book if you are kicked into a higher tax bracket with no increase in real income. The 1758% price rise in England (see Telegraph.co.uk) is thanks to Ben’s ilk across the pond- the Keynestone Kops Run amok- the thing that really frightens them is the thought of their printing presses being broken up by saboteurs (as in workers jamming their sabots into machinery that was ruining their lives)

I’ll donate… I am amazed in all the talk here of IQ’s, such flagrant use and direction of foul language and ad-hominem attack. Is that what intelligence brings to the modern-day table of discourse? I can say one thing for 100% certainty: Using the oft-cited ‘1950’ time frame to present, for all our technological advancement and ‘smarts’, we are infinitely more ‘coarse’. And since ‘technology’ has little or nothing to do with that aspect of human nature, what could it possibly be? After all, we’re so much better off today than we were back then…

Llpoh — Kudos, you have certainly defended your position. I’m dizzy reading all the posts and I’m late to the party. Never the less, I wish to make a few salient points.

IQ is a variable as has been shown. It is not fixed as once was thought.

Labor has always been stratified with wages correspondingly so. Skills are developed over time and society values those skill appropriately. Remember, Albert Einstein was a lowly patent clerk when he developed his major theory. Yes, I know, he was an exception, but the world is replete with exceptions.

IQ test for measuring intelligence have a built in bias as all tests do. That’s why we have triple blind studies.

Surveys, tests and other computational rigamarole often supply the results that the authors had theorized. (intentional bias) As a Ph.d. friend, once, lamented , “If the facts disagree with the theory, so much the worse for the facts.”

Now to you. Llpoh!– “Let us assume that income very broadly and basically tracks intelligence – which it does to a significant extent.”– PROVE IT. I’m not buying your supposition. Correlation is not causation. I feel that, more often than not, we seek to justify our advantage in life with a philosophy that which supports that advantage. “We are exceptional, the chosen ones, history has chosen us, we are better than the Hop Polloi, etc.”… to lead, to rule, to make more money, etc. etc. etc.

Kudegras is right. Your position in society is very much influenced by familial, educational, business associations. You want to be part of the 1% , choose your parents, carefully and buy into your exceptional-ness, and tow the party line, your IQ not with standing.

Education, once the stepping stone to higher wages, elevated social standing and all the privileges that go with it, has proven, as a whole, to be illusory to the middle and lower classes, again. IQ not with standing.

Lipoh, I feel that your looking for justification for your advantages in these graphs. I see that you are very intelligent and focused. But, I remind you that the Progressives, from the 1800’s, have espoused a philosophy of exceptional-ism that led to the decimation of the American Indians, the Tuskegee Experiment, the subjugation of the Negro, Hitler, and a myriad of other sins. People in power, structure society to their aims and these graphs may demonstrate that.

Lipoh–Like the other commenters, I can’t let your idea go unchallenged, historically, the consequences are, for society, so dire.

Intelligent people also realize that All information provided by government or the federal reserve is either misleading or completely false in order to placate and fool citizens – and keep them under control.

Any discussion of topics that waver from ending the federal reserve and completely reforming government to save the middle class and our country’s future is a waste of time. There are many good comments and the Admin makes excellent points as well – that’s why I closely follow this site and some others.

As many posters here already believe, perhaps the “die is cast” regarding our economy. However until this happens, everyone who understands the reality of what’s happening in our country (government corruption, massive overspending and waste, federal reserve dollar devaluation, job losses, Derivatives gambling, increasing debt, etc.) has a obligation to themselves and their families to keep making whatever effort they can to persuade others of the need for reform – however pointless it may seem considering widespread public apathy.

The Admin and others are doing what they can with their sites. All others must also do what they can to convince their family, friends, etc. of the need for major and immediate reforms of government despite the odds. Without this, collapse is certain – sooner than later.

“The Community Reinvestment Act is a United States federal law designed to encourage commercial banks and savings associations to help meet the needs of borrowers in all segments of their communities, including low- and moderate-income neighborhoods. Congress passed the Act in 1977 to reduce discriminatory credit practices against low-income neighborhoods, a practice known as redlining.

The Act instructs the appropriate federal financial supervisory agencies to encourage regulated financial institutions to help meet the credit needs of the local communities in which they are chartered, consistent with safe and sound operation. To enforce the statute, federal regulatory agencies examine banking institutions for CRA compliance, and take this information into consideration when approving applications for new bank branches or for mergers or acquisitions.”

Translation of this message by the federal government to the banks: “We got you by the balls.” Translation of the message of the burst housing bubble by the banks to the federal government: “We got you by the balls.”

Agent P – hahahahahahaha! You must be truly new. We use bad words like poopoo, weewee, and darn all the time around here. Get used to it.

Homer – I already proved that intelligence tracks income. Seriously, can anyone really argue it does not? That someone from the bottom 10% has the same chance of making good money as someone from the top 10% of incomes?

I never said being smart causes higher earnings. I said that, in (almost) any given cohort, the cohort that is smarter will make more money. Statistics prove this is so. And common sense would of course indicate the same. But what folks choose to do is to pull anecdotes – we all have some – similar to “I know someone with a PHD who is dumpster-diving for a living”. I know those sorts, too. But mostly, I see smarter folks making more money.

Re your comments on earnings being more related to birth status – ummm, no. What the research show that earnings relate far more to intelligence.

HOWEVER – the research shows that WEALTH relates to birth status. In other words, people inherit wealth, and that is truly luck of the draw. I really do not like that extreme wealth transfers via birthright. That creates dynastic oligarchies, in my opinion.

“But the fact is, the middle class was unsustainable, and owed its position to 1) the hugely beneficial position the US found itself in post WW11, and 2) it held its position via huge consumption of debt.”
—-llpoh

Well, tons of words on this thread, but that single sentence sums up the truth ….. meaning I agree with Llpoh. Big steel, gone. Big machine and tool, gone. Big car, gone. I could name more major manufacturing industries that were protected by the result of WWII, but you get the picture. We were the last man standing after the war. That’s a fact. The homeland didn’t even suffer a scratch, much less a minor flesh wound.

Then the spending spree (debt) kicked in, fueled by Keynesian economics at the policy-making level. Game over. Took about 3 generations, but game over.

Thanks, SSS. When one of your caliber says such a thing, it makes my day better.

The IQ stuff was just to inflame the masses.

The US came out of WW2 with huge manufacturing capacity, and a ton of natural resources, which it used to its advantage while the rest of the world began to climb out of the rubble.

When that advantage began to wane, the US turned to debt.

Consumption has been preferred to investment in the future. The people chose cars, TVs, and such, and the govt poured money into the military. Consume now was preferred and chosen over investment in roads, transport, water, electricity, etc.

The advantages that existed have largely disappeared, and the govt has done much to expedite the problems, for sure and certain. And major corps and banksters and oligarchs have certainly taken unfair and often illegal advantage of the situation.

But the problems were coming – the US people have very much contributed to their own downfall. The developed a sense of entitlement rather than understanding that they had been given an enormous and unique opportunity to solidify the future of the country. They chose to consume the future now, and let the next generations pay for it. It is a disgrace.

But there is no stopping the demise of the middle class now. It was always going to fall back toward the mean, but now it is going to be more like a crash than a gentle bump in the road.

The sooner people see this, and change their behavior, the more likely they are of coming through the crisis in one piece. I believe the best chances for any individual lie in the old order of things – honesty, integrity, hard-work, thrift, education, appreciation of family and community. I have tried hard to establish these things in my children. Time will tell if they have learned, and whether it will work for them.

I have little to gain by this. I am going to head to pasture reasonably soon, and am structuring my life so as to be insulated, best as possible, from the coming crisis.

“I am going to head to pasture reasonably soon, and am structuring my life so as to be insulated, best as possible, from the coming crisis. But I am sorely aggrieved at what is happening to the young.”
—-Llpoh

I’m already in the pasture and have done as you plan. I share your sentiments.

BTW, your views on IQ are largely accurate, but I think you could have saved yourself a lot of trouble by just posting the following comment:

Llpoh says—“I already proved that intelligence tracks income. Seriously, can anyone really argue it does not?” You’ve proved nothing of the sort. You have just shown a correlation between income and intelligence and a small sampling at that. You’ve left yourself quite an escape hatch in framing your thesis with “very broadly and basically tracks”. Who could argue with that? There is more here than meets the eye. Define intelligence and income. I would think that intelligence is a nebulous concept (subject to interpretation of variables) and that income is concrete (except in Title 26). One would have to take all persons with incomes and give them an IQ exam to discern the validity of your thesis and not a weak sampling using extrapolation to prove your point. What kind of intelligence are you talking about? There is more than one, although the definition tries to be all inclusive.

So, we’re moving into a technological world as that’s the future and those of us who are intelligently challenged are left to deal with your shit or rig the flight controls of a 767? I think not! The world is running out of easily obtained resources, of which technology is dependent. There may be a nuclear war in the offing. Then the cockroaches can carry on and sort things out. How intelligent are they?
The future is never what we think it will be and the past is only constructed in hind sight to serve our agenda, It is obvious from these posts that many are in disagreement with your interpretation of the present and vision of the future.

I was hoping someone would add to the topic on money printing. Old Sarge said, I don’t want a lot of money, just enough to buy and sell you. When you have access to a printing press, you can buy and sell a lot of people.

Llpoh says to SSS—”The IQ stuff was just to inflame the masses.” Thanks for the buggy ride!

I have been reading your posts often and sensed this was out of character, which is why I replied to your posts respectfully. Your post to SSS convey my sentiments. However, I am a little more optimistic as to the outcome. Blame it on my belief in God. I know what you’re thinking, “They say that God is everywhere, and yet we always think of Him as somewhat of a recluse.”–Emily Dickinson. I never wanted to go through life with ‘eyes wide shut’. I look at the stars and I marvel. I wonder at the complexity it all and I am over whelmed at its intricacy, its beauty, its splendor. I feel Him in me and in you. I’m sorry, I believe in God. I can’t help myself. Carl Sagan once said that we are all made out of star stuff. We are all made out of God stuff and all things are possible.

I have a different opinion about inheritance. I believe in inheritance. I don’t think it should be taxed. We have inheritance taxes now and we have and oligarchy now. They pass on their wealth through foundation, exemptions from laws, corporations, etc. to their heirs. It matters little who owns a thing, what matters is if you have 100% exclusive use of it.

Tax the rich is the biggest lie to come down the pike! Inheritance tax, the redistribution of wealth, is a socialist scheme. It always seems to enrich the people doing the redistribution. It impoverishes the middle class and the poor and keeps them that way. It restricts familial upward mobility. Passing on your wealth to your heirs enhances their future and provides a head start for them. The inheritance tax steals from one and gives undeservingly to another, robbing the heir of his rightful due. “Thou shall not steal, except by popular vote.” — Gary North.

Homer – I do not mind passing reasonable wealth on to ones family. By reasonable I mean tens or perhaps hundreds of millions. But tens of billions is far too much, and it creates hereditary dynasties. I really hate it when I discover that rich dunces got their money via inheritance (wealth does not reflect intelligence – that has been shown. )

I also do not believe in taxing the rich – it is bullshit, and it will solve nothing in any event. When people say rich, they generally mean folks like doctors, small businessmen, etc. they just do not seem to realize it is those that are netted in the class warefare,

Re the passing on of wealth, the massively rich can pass on say a billion, or whatever, but they can either establish a charitable foundation with the rest, or lose it to the govt. it should not be able to be hidden behind trusts.

That is my opinion, anyway. I do not want to strip anyone of the right to create a future for their families. But leaving tens of billions in inheritance creates a hereditary oligarchy that is really very damaging to the opportunities of others.

Llpoh, let’s suppose you are right. Income tracks IQ in general groupings of people. OK, well, generally speaking, those referred to as “blacks” have lower IQs than those referred to as “whites”, and they in turn, as a group, have lower IQs than those referred to as “Jews”, and they in turn, as a group, have lower IQs that those referred to as “Asians.” All we have seen since the 1950s, then, is the inevitable movement of income/wealth from blacks to whites to Jews (who still dominate the financial industry, despite a great deal of rhetoric to obfuscate that fact), to Asians. In fact, if your theory is correct, you are merely describing the inevitable process of Asians gradually taking over the wealth of the world. THEY are smart enough to realize that to do so, they need to keep as many of their people employed and earning incomes as possible. So, they underbid higher Western labor costs, while keeping internal prices low, so their overall standard of living keeps rising. I have spent most of my adult life in and around Asia representing the US government in a variety of roles. Speak Chinese. Know what I am talking about. I’ve watched a people rise from grinding poverty to providing the largest single ethnic group in the world an increasingly decent living. They’ve gone a long way to capturing the largest portion of the global income stream (think third largest economy – Japan + second largest economy – China + add in Korea, Indonesia, Vietnam – I am correct in this – this is not a false statement). The reason manufacturing in the US has had to become so efficient, which mostly means reducing labor costs, is that the Asians, as a group, captured those jobs. They did so cleverly, smartly, and seemingly permanently, or at least for our lifetimes. If they were playing a game of “Go” (which they are, for the global economic prize), they would now be at the stage the Japanese call “Atari” which is one move away from surrounding a cluster of your pieces and taking them off the board, We were warned (albeit in Japanese, and in a subtle way) that that was exactly what they were doing. So, your continued blatherscathe, which essentially pats yourself on the back for all the goodness you are doing, misses the point. YOU may be providing some decent jobs – and thank you for that – but the overall majority of the US economy isn’t. And now Asia is coming for the higher paying service jobs too. They are already taking their newly earned wealth, and buying much of the real wealth of this nation – the productive farmlands, mines, etc. They have allowed us to clean up the pollution we created in the 50s and 60s and 70s. In the not too distant future, they will be our masters. Just like you are positing – they are smarter than the “whites” and “blacks” and “Jews”. So, it’s inevitable, right? Hope your kids and grandchildren can read characters, Llpoh. Going to come in pretty handy fairly soon. Heck, it already IS a way to earn a fairly decent income… Of course, not a lot of stupid people can learn Asian languages, but then, that’s been your point all along, right? Higher IQs are the inevitable winners in the grand game of “go get it?”

llpoh said:
“They object because they want to believe that the loss of the middle class is not inevitable and that it was avoidable. ”

I’m late to the discussion and I’ve not read every comment but I too believe that the middle class (as we know it) was an anomaly and doomed to extinction. It was only possible due to the printing of unlimited fiat currency and the post WWII advantage that the USA enjoyed. A large, affluent middle class, much like retirement for the masses is exceedingly rare prior to the 1900’s.

I personally see deflation as a threat, but asset inflation actually that is not a part of core inflation makes that deflation more of a threat. So the more QE they do, the more they have to do or it will crash. But the less effective it is.

You wonder what happens when they run out of bullets.

But don’t be fooled, they are doing this to save the banks and facilitate the banks betting on the low interest rate side of the swaps. The banks take the low and floating side, and the small company borrowers are forced to take the high fixed side of the bet. And the banksters always win, because if they don’t they will all crash together.

from LIPOH below:
The top 5 or 10 percent will do well. The rest better do something to lift their game, or they are screwed.

This is a democracy.
The disenfranchised whose jobs were sent to China to enrich the .001% will vote
to take those jobs and that money back.
The only thing stopping them now is as you said, their own stupidity by being
befuddled with FOX lies.
The elite better keep feeding them and not just food but phones, beer and cable
or it will be 1933 again.

zetroit – those jobs are not coming back. Voting to bring back jobs? Just how does that work?

Creating jobs requires capital. Who will provide the capital? Poople with it will only provide it if they can make a profit by so doing.

If you confiscate all the money from the .001 as you are saying – say from all of the US billionaires, , it amounts to less than $2 trillion. So if you take all of their money, it amounts to about one year’s deficit.

Plus, most of that wealth is not money – it is the value of shares. Taking it from them would result in a massive plunge in the value of the shares. You would be lucky to realize $500 billion or so from so doing.

And that money would be immediately consumed.

And then again the question would arise – where is the capital going to come from to create jobs?

In my opinion, there is only one hope of creating jobs. Jobs must be created from the ground up – jobs must be created by individuals and small businesses. But it is currently almost impossible to start a small business.

Those are the laws that we need to vote to change. Along with banking laws, etc. But if we do not have politicians that will do the bidding of the voters in that respect, voting will not matter.

BTW – taking the net wealth of the rich will be of not benefit whatsoever. They do not have enough net wealth to cover the debt.

The problem with the mega- wealthy is not so much their wealth, but it is their power and influence over the political and economic processes. Their wealth is relatively inconsequential, and would dissipate in short order if confiscated. The power they wield with that wealth is the issue.

If you take the $2 trillion from the billionaires – assuming you can get it all in cash, which you cannot – and redistribute it, each US citizen would get around $6000. That money would be immediately spent on TVs and such.

I do not envy the megarich their wealth – far from it. I do hate those that use their wealth to buy power and influence. Taking their wealth will not make me rich, but taking away their power and influence will offer me, and everyone else, a far better chance of accumulating wealth than now exists.

“If you confiscate all the money from…from all of the US billionaires, , it amounts to less than $2 trillion. ..
Plus, most of that wealth is not money – it is the value of shares. Taking it from them would result in a massive plunge in the value of the shares. You would be lucky to realize $500 billion or so from so doing.”

I had calculated the wealth of the top layer around 1 trillion$, why dump all those billions$ into the market if you can only sell it at a yard sale for 500 billion$?

Obama or Hillary WILL be confiscating money from billionaires, and millionaires and business owners, and everyone else with money in the bank. It’s called a “bail in”, like in Cyprus, and it will be used to keep the banks and government solvent awhile longer. There’s $17 trillion sitting in off-shore accounts as we speak. The IRS has forced every off-shore bank, every Swiss bank, every bank in the world (except Singapore) to turn over records of deposits and depositors. The banks have complied, and the government and IRS now has ALL this data. They will “nationalize” this money when the T-bill market (issuance of IOU’s—debt) implodes. Anyone with money in banks is a fool, period. It will be gone with the wind, into the pockets of the criminals in Washington, and redistributed to the FSA and union government drones until the last dollar is gone.

The best way to destroy the capitalist system is to debauch the currency. By a continuing process of inflation, governments can confiscate, secretly and unobserved, an important part of the wealth of their citizens.

1) “what on earth do you do for a living? I run/own a manufacturing business. Yet you think you know more about my business than I do? You are really less than bright, aren’t you?”

Given that this is the internet – what you say is completely unsupported and cannot be automatically trusted as true.

But let us assume that it is for the sake of argument. First, what are you actually manufacturing? Is it something which actually competes on the world stage, or is it a protected industry like defense? Or perhaps something which cannot be economically offshored like cement? The detail matters considerably; the former is a legal monopoly, the latter is an economic one.

As for knowing about the business – I run businesses of my own both in the US and outside. Do you? If you don’t, then clearly you are the one who doesn’t actually understand what the differences are.

2) “Corporations move overseas because of a range of reasons, but they all come down to one thing – money. First, the corporate tax rate in the US is the highest in the world. Second, wages are very high in the US – even at the minimum wage, wages are very high relative to many other nations. Third, there is massive red-tape and EPA issues, etc., that drive up costs. Fourth, many other nations offer larger pools of skilled employees ( for instance, if you have a need, you LITERALLY can hire THOUSANDS of engineers in China in a week. It would be impossible to EVER fill those positions in the US, much less to do that in a week.).”

Meh. Again, your ignorance is terrifying. Corporations who are moving overseas are doing so not because of corporate taxes. For one thing, the actual tax rate corporations pay as a percentage of profit or revenue is very low in the US. The rate doesn’t matter if no one actually pays it.

Secondly, the wage argument is idiotic. Are US wages lower than Germany? Sweden? Norway? The answer is NO. Yet those economies are doing fine. Clearly wage cost isn’t the issue.

Jobs skills: Again, you talk without actually having a clue. The reality is that there are plenty of Americans with skills – but why pay them when you can bring in H1B’s and pay 3 of them for the same wage? The H1B is pure corporate indentured servitude.

3) “What does bad government policy have to do with the cost of labor being cheaper elsewhere? What do you propose, you Einstein you – huge import taxes?

Government policy could have reduced the corporate tax rate, the cost of red tape, etc. It would not have effected the decline in manufacturing employees to the extent of eliminating the decline – it would have flattened the slope of the decline somewhat, but not eliminated it.

Here is a little tidbit – the US is a major exporter of manufactured goods. The US exports around a trillion dollars in manufactured goods per year. What do you think would happen to the export market if the US put in place import taxes?”

Nice try at a straw man. Sadly, I never once mentioned taxes – what I mentioned was a pathetic health care regime, a pathetic Social Security setup, financial feudalism, and corporate cronyism.

Note yet again that in Europe, there are plenty of nations with both high wage rates AND a strong social safety net. Neither wages nor taxes are the issue.

4) “Your point re transfer schemes is idiotic. Transfer schemes are used to transfer costs to the US, and away from offshore entities so as to put the profits in the offshore entities. The problem is not the transfer scheme, as you put it, the problem is that the US corporate tax rate is the highest in the world.

So what would happen if the transfer schemes were eliminated? Well, the corporations would move ENTIRELY offshore, now wouldn’t they. The problem is ENTIRELY the absurd corporate tax rate.”

I, for one, am willing to try this “bluff”. If you want to move to Rwanda in order to take advantage of its cheap wages – and have your kids go to Rwandan schools, your family live in Rwandan infrastructure – be my guest. Don’t let the door hit your ass on the way out.

5) “And finally, you say “Combine this with executives who are rewarded for the short term financial illusion of greater productivity”, which proves you are a total, blithering idiot.

Greater productivity is no illusion. If CEOs are rewarded for increasing productivity, then I applaud them, I cheer them, I congratulate them on their success. That is high achievement indeed. Business desperately needs increased productivity in order to survive and thrive.

Unfortunately, it is rare that executives are rewarded for this. Instead, they tend to be rewarded for increasing share prices, or for increasing profits. Those indeed can be “short term financial illusions”, and they are rampantly manipulated and abused by executives. ”

What a load of bollocks. CEO’s are no more productive now than they ever were. The idea that the CEO is creating value is pure propaganda – as the Nardelli’s of the world amply demonstrate.

C1lue – my bona fides are well established. Yours are not, especially given your total lack of understanding of so many things.

Your understanding of the handful of countries doing well in Europe is limited. Check out Germany!sbanking health, which funded the German mfgs via the Eastern bloc, and get back to me.

You did not mention taxes, I did. You healthcare argument, while undoubtedly playing a part, as it is a cost to business, is not the major cost. There are many more severe issues to business than that.

I never said CEOs are more efficient. I said they should be paid for their companies being increasingly efficient, as opposed to being paid for increasing profits or share prices.

And, as I said, transfer schemes only exist because of the idiotic corporate. To deny that is idiotic.

I really love the way, when you ate getting your ass kicked, that you simply imply the other person is a fake.

Re what I make, I do have the advantage of distance over China. All mfgs do. But that would in itself be insufficient if I was not good at what I do. My major competitor has moved 90 percent f his business overseas in the last 12 months. I have never moved a job offshore, and have no intention of doing so. But I do on occasion lose business when my advantages – quality, service, deliver, etc are perceived by a customer as insufficient. I do not compete on price. I do have some offshore interests, but they do not export to the US.